Save on taxes

Voluntary payments into your pension fund can generally be deducted from your taxable income. Ideally these additional purchases should be staggered over several years. This will allow you to save more on taxes than if you had made a one-time contribution. However, be aware that you cannot withdraw from your pension fund, e.g., to buy a self-occupied residential property or as retirement income, for three years after you make an additional purchase. If you do so, the tax benefits of the additional purchases will be annulled.

Depending on your canton, you can save a lot of money by drawing on your retirement savings in stages, for example, to repay the mortgage on your home or when you retire. This way you can avoid paying higher rates of tax. You should thus try to stagger the capital withdrawals you make from your pillar 3a account, pension fund or, if applicable, vested benefits foundation. One way of doing this is by holding multiple pillar 3a accounts.

Pension fund rules often allow for semiretirement. Continuing to work part-time can also have tax advantages, with many cantons allowing you to make two lump-sum withdrawals.

If you plan on moving home when you retire, check whether your tax situation is better where you are now or at the new address. Your income and wealth taxes are generally calculated according to where you are living on 31 December of a given year. By contrast, lump-sum withdrawals from your pension fund or pillar 3a savings are taxed according to where you are living when the money is paid out.

You will also need to review and plan withdrawals of retirement savings if you decide to move abroad.